If Data Is The New Oil, We Are Spilling It Everywhere

The Problem

Recently Farai Chideya of FiveThirtyEight wrote an article that strikes at the very heart of all personal data issues — identification and authentication. Identification and authentication are the processes of proving you are who you say you are, which is the basis for almost all transactions, online or off line.  

When someone else can effectively claim to be you, all hell breaks loose. Unfettered identity theft occurs because how we identify and authenticate individuals online (and in the real world) is utterly broken. It creates an artificial sense of security and incentivizes bad behavior. The system is flawed because we have conflated the concept of data with our idea of privacy. This makes data an artificially scarce commodity that only a few have control over, none of who are the people from which the data is derived. This system (if you want to call it that) is built on preexisting structures and legal precepts that are inadequate given the present state of how individuals interact with the Internet, especially considering how the Internet has ingratiated into all aspects of our lives, given the de jure position that data is the new oil (i.e. a commodity to be exploited for commercial use).

Ok, so now you’re thinking, “yeah, Evan, we get it. The current system is necessary, but woefully inadequate at protecting us from indiscriminate digital death. So what? What does this have to do with entrepreneurship?”


Data is an extension of our identity and being; your online persona is you. Unfortunately data is not treated as such and therefore we suffer from massive abuse and inefficiencies. If we continue to operate under the current system we will only exacerbate the issue and remain frustrated as we try to both protect and use data. If we want to encourage entrepreneurs, support institutions and other local governments to responsibly use personal data in all forms, I think it behooves us to investigate how we might positively contribute to the promulgation of a better, more effective, and more equitable process.

The Solution

Sandy Pentland the incredible team at MIT Media Lab has produced an impressive body of work on how we should reimagine data, which can be found in his New Deal on Data. It is an incredible foundation for how we as a digital society might properly conceptualize data and its use, which leads to more robust social interventions and sustainable business plans. In fact the White House, Seattle, and Kansas City, Missouri have all passed data privacy policies that reflect the basic tenants of the New Deal on Data. But it is merely the beginning to a more equitable process. The European Union’s recent decision to eliminate a data transfer safe harbor for high tech, data dependent companies could be a harbinger for an era of increased scrutiny.

The New Deal on Data and the above examples essentially draw a line in the sand that any future data use structure — be it public or private — must provide two things, notice and control. How notice and control is actually meted has yet to be seen, if only because technology will dictate the actual structures of data use. 

But why are notice and control so vital to equitable data use? Notice and control are the mechanisms by which we can price and trade our data. If you have notice of how exactly your data will be used, then you can accurately price your data. Control means that the individual can actually prevent unauthorized use and allow for authorized use on a case-by-case, or user-by-user basis. Notice and control function are the bedrock principles for a data market where the data producers (you and me) can trade on an equitable level with the data users (Google).

A fluid and functional market for data is a far cry from what data market currently exists. Overhauling our current system might seem like a tall order, but in fact there does potentially exist technology that could provide the infrastructure for control mechanisms. The largest obstacles are not tech, but the complete lack of social interactions, legal agreements, and trust networks. How we think of data prevents the best use of data.

Entrepreneurs, how does data compliance and security affect your business? If you collect personally identifiable data, how do you protect it?

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Evan Absher

Evan Absher

Evan has a background in law and municipal policy and specializes in civic and social entrepreneurship.